Chapter 07: Performance Management
1. Which of the following is true about performance management?
A. The process contains 3 steps.
B. Research indicates that most companies manage performance well.
C. It is indirectly related to achieving strategic objectives.
D. The process does not involve coaching.
E. Better performance management represents a largely untapped opportunity to improve
company profitability.
Answer: E. Better performance management represents a largely untapped opportunity to
improve company profitability.
2. The critical step in employees' understanding of how their work makes a contribution is
A. the career planning session.
B. the promotion decision.
C. the appraisal session.
D. defining performance expectations.
E. the pay decision.
Answer: D. defining performance expectations.
3. To clarify performance expectations, ________ should be developed.
A. strategic objectives
B. a list of traits
C. an HR strategy
D. a business plan
E. measurable standards
Answer: E. measurable standards
4. The following are all reasons for the failure of a performance appraisal except
A. arguing and poor communications which arise as problems during feedback sessions.
B. not telling employees ahead of time exactly what is expected of them.
C. having poor measures of performance.
D. clearly defining performance standards.
E. a lenient supervisor.
Answer: D. clearly defining performance standards.
5. The simplest and most popular technique for appraising employees is the
A. alternation ranking method.
B. critical incident method.
C. forced distribution method.
D. graphic rating scale.
E. paired comparison method.
Answer: D. graphic rating scale.
6. A scale that lists a number of traits and a range of performance for each is called a(n)
A. alternation ranking method.
B. behaviourally anchored rating scale.
C. graphic rating scale.
D. forced distribution method.
E. paired comparison scale.
Answer: C. graphic rating scale.
7. Renu has been hired as the first human resources professional at a growing landscape
architecture firm, Terrastyle Inc. The firm is currently using a formal appraisal method which
lists traits such as "teamwork" and performance values ranging from "needs improvement" to
"outstanding." Terrastyle is using which of the following appraisal methods?
A. critical incident method
B. behaviourally anchored rating scale
C. forced distribution method
D. graphic rating scale
E. paired comparison method
Answer: D. graphic rating scale
8. A common method for appraising performance which involves evaluating employees by
ranking them from best to worst on some trait is called the
A. behaviourally anchored rating scale.
B. paired comparison method.
C. forced distribution method.
D. alternation ranking method.
E. graphic rating scale.
Answer: D. alternation ranking method.
9. An example of the alternation ranking method would include all of the following steps
except
A. crossing off names not known well enough to rank.
B. defining the compensable factors.
C. putting the lowest-ranking employee on the last line.
D. listing the highest-ranking employee on the first line.
E. listing all the employees to be ranked.
Answer: B. defining the compensable factors.
10. The method for appraising performance which ranks employees by making a chart of all
possible pairs of the employees for each trait and indicating which employee is the better of
the pair is known as the
A. paired comparison method.
B. forced distribution method.
C. alternation ranking method.
D. graphic rating scale.
E. critical incident method.
Answer: A. paired comparison method.
11. The performance appraisal method that would use a "+" to denote "better than" and a "‒"
to denote "worse than" when comparing employees, in order to get the highest-ranked
employee, is the
A. alternation ranking method.
B. critical incident method.
C. paired comparison method.
D. forced distribution method.
E. graphic rating scale method.
Answer: C. paired comparison method.
12. The performance appraisal method which is similar to grading on a curve and which
places a predetermined percentage of ratees in various performance categories, is the
A. paired comparison method.
B. critical incident method.
C. alternation ranking method.
D. graphic rating scale.
E. forced distribution method.
Answer: E. forced distribution method.
13. Renu has been hired as the first human resources professional at a growing landscape
architecture firm, Terrastyle Inc. She is considering changing the current performance
appraisal method, the graphic rating scale, to the forced distribution method of performance
appraisal. What criticism of using this method do you advise her about?
A. Traits being appraised are decided by management.
B. Predetermined percentages of employees are placed in performance categories.
C. Employees are rated on a comparison basis.
D. It is similar to grading on a curve.
E. A considerable proportion of the workforce is classified as less than average.
Answer: E. A considerable proportion of the workforce is classified as less than average.
14. The performance appraisal method which involves keeping a record of uncommonly good
or undesirable examples of an employee's work-related behaviour and reviewing it with the
employee at predetermined times, is the
A. paired comparison method.
B. behaviourally anchored rating scales.
C. alternation ranking method.
D. critical incident method.
E. forced distribution method.
Answer: D. critical incident method.
15. All of the following are advantages of the critical incident method except that it
A. provides concrete examples of what an employee can do to eliminate any performance
deficiencies.
B. ensures that the evaluator thinks about the employee's appraisal all during the year.
C. ensures that the evaluator will only consider the employee's most recent job performance.
D. can be used to supplement another appraisal technique.
E. provides the evaluator with some specific hard facts for explaining the appraisal.
Answer: C. ensures that the evaluator will only consider the employee's most recent job
performance.
16. The critical incident method of performance appraisal is often used to supplement a
A. management-by-objectives method.
B. paired comparison method.
C. narrative form.
D. forced distribution method.
E. ranking method.
Answer: E. ranking method.
17. In a behaviourally anchored rating scale, there are critical incident anchors along the
A. performance rating scale.
B. forced distribution scale.
C. graphic rating scale.
D. paired comparison scale.
E. alternation ranking method scale.
Answer: A. performance rating scale.
18. An appraisal method that aims at combining the benefits of narrative, critical incidents,
and quantified ratings by anchoring a quantified scale with specific narrative examples of
good or poor performance, is called the
A. graphic rating scale method.
B. paired narrative-quantitative method.
C. critical incident method.
D. behaviourally anchored rating scale method.
E. anchored narrative-quantitative method.
Answer: D. behaviourally anchored rating scale method.
19. The following are all steps in developing a behaviourally anchored rating scale except
A. developing performance dimensions.
B. causing critical incidents to occur.
C. scaling the incidents.
D. generating critical incidents.
E. developing the final instrument.
Answer: B. causing critical incidents to occur.
20. The simplest and most popular technique for appraising performance is
A. simply giving raises to the employees you like.
B. forced distribution.
C. graphic rating scales.
D. behaviourally anchored rating scales.
E. paired comparison.
Answer: C. graphic rating scales.
21. An advantage of the critical incident method is that
A. it provides instant feedback to employees on critical issues.
B. it focuses on the whole job and how every task is performed.
C. results are easily linked to pay increase decisions.
D. the process is transparent for both managers and their employees as the criteria are agreed
to in advance.
E. it provides hard facts for explaining the appraisal.
Answer: E. it provides hard facts for explaining the appraisal.
22. The following are all advantages of the behaviourally anchored rating scale appraisal
method except
A. clearer standards.
B. consistency.
C. specific forced behavioural dimensions.
D. specific feedback for supervisors to give employees.
E. a more accurate measure.
Answer: C. specific forced behavioural dimensions.
23. A method for appraising performance involving setting specific measurable goals with
each employee and then periodically reviewing the progress made is called
A. progress review method.
B. critical goal method.
C. behaviourally anchored rating scale method.
D. management by objectives.
E. periodic review method.
Answer: D. management by objectives.
24. MBO almost always refers to a comprehensive organization-wide goal-setting and
appraisal program that consists of all the following steps except
A. setting long-term performance targets.
B. setting the organization's goals.
C. setting the department's goals.
D. providing feedback to employees.
E. discussing the department's goals.
Answer: A. setting long-term performance targets.
25. All of the following are problems that are typically encountered when an organization
uses the MBO method of performance appraisal except
A. time-consuming procedures.
B. unmeasurable objectives.
C. tug of war concerning objectives between supervisor and employee.
D. unclear objectives.
E. measurable objectives.
Answer: E. measurable objectives.
26. When it comes to performance appraisals, most firms combine
A. computerized techniques and BARS.
B. manual techniques and MBO.
C. computerized and narrative techniques.
D. several appraisal techniques.
E. manual and subjective techniques.
Answer: D. several appraisal techniques.
27. When using MBO, in order to avoid having the process demotivate employees, objectives
must be
A. easy to attain.
B. fair and attainable.
C. based on the employee's educational level.
D. difficult to attain.
E. the same for all employees in the same job.
Answer: B. fair and attainable.
28. Because of good results, more employers are turning to a new approach to appraisal,
namely a
A. bell-shaped curve.
B. point method plan.
C. forced distribution system.
D. critical incidents narrative.
E. computerized performance appraisal system.
Answer: E. computerized performance appraisal system.
29. Which of the following is not an advantage of the behaviourally anchored rating scale
method?
A. It is relatively consistent and reliable.
B. The critical incidents allow for clearer standards.
C. It is generally a more accurate measure of performance.
D. It is the simplest form of performance appraisal, so little supervisor time is involved in
using this performance appraisal tool.
E. It provides specific behavioural examples for each trait.
Answer: D. It is the simplest form of performance appraisal, so little supervisor time is
involved in using this performance appraisal tool.
30. Appraisal systems must be based on performance criteria that are ________ for the
position being rated and ________ in that their application must produce consistent ratings
for the same performance.
A. reliable; valid
B. reliable; reliable
C. valid; measurable
D. measurable; valid
E. valid; reliable
Answer: E. valid; reliable
31. The following are all problems for managers when using performance appraisal methods
except
A. unclear standards.
B. central tendency.
C. appraisal bias.
D. halo effect.
E. quota appraisals.
Answer: E. quota appraisals.
32. When an appraisal scale is too open to interpretation, it is characterized as having
A. non-quantitative standards.
B. translation openness.
C. unclear performance standards.
D. lack of appraisal specificity.
E. critical incidents.
Answer: C. unclear performance standards.
33. A graphic rating scale used with unclear standards may appear to be objective, however, it
will probably result in unfair appraisals because the traits and degrees of merit are
A. open to interpretation.
B. tightly structured.
C. well defined.
D. specific in nature.
E. too strict/lenient.
Answer: A. open to interpretation.
34. Gary is the supervisor of Mindy. He is very impressed with Mindy's ability to work in a
team, so he has rated her as "outstanding" for this trait. Although she has had more missed
delivery deadlines than her peers over the past financial quarter, Gary rated her as "above
average" for the trait of "personal effectiveness." Gary's actions indicate which of the
following performance appraisal problem?
A. bias
B. halo effect
C. trait effect
D. appraisal bias
E. trait bias
Answer: B. halo effect
35. Kai has a tendency to rate all of his direct reports as average. Kai's actions indicate which
of the following performance appraisal problems?
A. central tendency
B. halo effect
C. bias
D. appraisal bias
E. equal rating tendency
Answer: A. central tendency
36. When supervisors who are engaged in a performance rating tend to rate all employees
either high or low, this problem is referred to as
A. halo effect.
B. bias.
C. appraisal bias.
D. central tendency.
E. leniency/strictness.
Answer: E. leniency/strictness.
37. When supervisors allow individual differences such as age, race, and sex to affect the
appraisal ratings that employees receive, this problem is referred to as
A. strictness/leniency.
B. central tendency.
C. appraisal bias.
D. halo effect.
E. trait effect.
Answer: C. appraisal bias.
38. When an employee's most recent performance can affect the evaluation of his or her
overall performance, a ________ error has occurred.
A. appraisal bias
B. recency
C. central tendency
D. similar-to-me
E. halo
Answer: B. recency
39. The following are all ways to minimize the impact of appraisal problems, such as bias and
central tendency, except
A. training supervisors to eliminate rating errors.
B. refraining from confusing the employee by including him or her in the rating and
evaluation process.
C. becoming familiar with the typical rating errors that can undermine rating scale appraisals.
D. trying to understand the problem in order to prevent it.
E. choosing the right appraisal tool.
Answer: B. refraining from confusing the employee by including him or her in the rating and
evaluation process.
40. Improving appraisal accuracy calls not just for training of supervisors, but also for
A. a quantitative job evaluation system.
B. MBO.
C. reducing outside factors, such as union pressure and time constraints.
D. performance bonuses.
E. an effective employee orientation program.
Answer: C. reducing outside factors, such as union pressure and time constraints.
41. All of the following are advantages of various appraisal tools except that
A. alternation ranking is simple to use.
B. forced distribution results depend on the adequacy of the original choice of cutoff points.
C. BARS is very accurate.
D. a graphic rating scale is simple to use.
E. MBO is tied to jointly agreed goals.
Answer: B. forced distribution results depend on the adequacy of the original choice of cutoff
points.
42. The following are all disadvantages of appraisal tools except that
A. a graphic rating scale is simple to use.
B. MBO is time-consuming.
C. the critical incident method is difficult to use to rate employees relative to one another.
D. BARS is difficult to develop.
E. the alternation ranking method can cause disagreements among employees.
Answer: A. a graphic rating scale is simple to use.
43. Guidelines for developing a legally defensible performance appraisal process include all
of the following except
A. using clearly defined individual dimensions of job performance.
B. documenting evaluations.
C. providing definitive performance standards to rater and ratees.
D. incorporating job characteristics into a rating instrument.
E. conducting job specialization for each employee.
Answer: E. conducting job specialization for each employee.
44. The individual ratings that are still the heart of most appraisal systems are the
A. customer ratings.
B. individual ratings.
C. peer ratings.
D. self-paced ratings.
E. supervisor's ratings.
Answer: E. supervisor's ratings.
45. A potential problem with peer appraisal occurs when all the peers get together to rate each
other highly. This is called
A. halo error.
B. logrolling.
C. appraisal bias.
D. preferential evaluation.
E. leniency error.
Answer: B. logrolling.
46. The following are all advantages of using rating committees in the performance appraisal
process except
A. the composite ratings tend to be more fair than those of individual raters.
B. the composite ratings tend to be more reliable and valid than those of individual raters.
C. appraisal is generally more biased because of personality clashes.
D. several raters can help cancel out problems like bias and halo effect on the part of
individual raters.
E. variations in raters' ratings usually stem from the fact that raters often observe different
facets of an employee's performance.
Answer: C. appraisal is generally more biased because of personality clashes.
47. Rating committees are usually composed of the employee's immediate supervisor and
A. three or four peers.
B. that supervisor's boss.
C. that supervisor's boss and a customer.
D. three or four other supervisors.
E. other supervisors and peers.
Answer: D. three or four other supervisors.
48. The basic problem with employee self-ratings is
A. lack of anonymity.
B. employee reluctance to self-rate.
C. peers rate themselves lower than they are rated by supervisors or peers.
D. supervisor distrust of employee self-ratings.
E. employees rate themselves higher than they are rated by supervisors or peers.
Answer: E. employees rate themselves higher than they are rated by supervisors or peers.
49. More firms today let employees anonymously evaluate their supervisors' performance.
This process is known as
A. 360-degree appraisal.
B. team appraisal.
C. supervisor appraisal.
D. upward feedback.
E. anonymous evaluation.
Answer: D. upward feedback.
50. The 360-degree appraisal approach supports all of the following activities except
A. coaching.
B. leadership development.
C. succession planning.
D. job evaluation.
E. recognition.
Answer: D. job evaluation.
51. 360-degree feedback was originally used only for training and development purposes, but
has rapidly spread to being used in the management of
A. job evaluation.
B. performance and pay.
C. employee orientation.
D. customer service.
E. rating errors.
Answer: B. performance and pay.
52. The 360-degree appraisal approach fits closely with the goals of organizations committed
to
A. employment equity.
B. hierarchical chain of command.
C. MBO.
D. continuous learning.
E. pay equity.
Answer: D. continuous learning.
53. An employee's 360-degree appraisal usually involves all of the following appraisers
except
A. any employees reporting to the person being appraised.
B. supervisors.
C. peers.
D. competitors.
E. customers.
Answer: D. competitors.
54. Organizations that have implemented 360-degree appraisal would give the following
advice to those considering it except
A. provide training for supervisors, raters and ratees.
B. be clear about who will have access to reports.
C. assure all raters that their comments will be kept anonymous.
D. use standard questionnaires.
E. plan to evaluate the system for fine tuning.
Answer: D. use standard questionnaires.
55. The easiest appraisal interview to conduct is ________ performance, ________
employee.
A. satisfactory; unpromotable
B. unsatisfactory; unpromotable
C. unsatisfactory; correctable
D. unsatisfactory; uncorrectable
E. satisfactory; promotable
Answer: A. satisfactory; unpromotable
56. When preparing for the appraisal interview, there are three things to do. First, assemble
the data, second, prepare the employee, and finally,
A. choose the time and place.
B. prepare the appraisal examination.
C. do the performance appraisal.
D. lay out an action plan.
E. document all information to be discussed in the interview.
Answer: A. choose the time and place.
57. When conducting the appraisal interview, all of the following should be kept in mind
except
A. developing an action plan.
B. being direct and specific.
C. encouraging the person to talk.
D. talking in generalities.
E. not getting personal.
Answer: D. talking in generalities.
58. When a person is accused of poor performance, research indicates that the first reaction
that he/she may have is often
A. ignoring the accusation.
B. aggression.
C. changing the subject.
D. anger.
E. denial.
Answer: E. denial.
59. Best practices when dealing with defensive employees include
A. using intimidation to convince.
B. solving all problems quickly.
C. recognizing that defensive behaviour is normal.
D. explaining the person's behaviour to them.
E. never backing down.
Answer: C. recognizing that defensive behaviour is normal.
60. Rules for constructive criticism include all of the following except
A. ensuring criticism is free of bias.
B. that a once-a-year "critical broadside" can be effective.
C. providing suggestions about what could be done to change behaviour.
D. criticizing in private.
E. letting the employee maintain their sense of dignity and self-worth.
Answer: B. that a once-a-year "critical broadside" can be effective.
61. The following steps are all important to ensure that the appraisal interview leads to
improved performance except
A. that the supervisor should be helpful and constructive.
B. that the supervisor should be in firm control of the interview.
C. giving employees the opportunity to present their ideas and feelings.
D. setting improvement goals and a schedule for attaining them.
E. ensuring employees don't feel threatened during the interview.
Answer: B. that the supervisor should be in firm control of the interview.
62. A written warning to an employee with poor performance should include all of the
following except
A. specifying that 360-degree appraisal will be used in future.
B. specifying any violation of the standards.
C. making it clear the employee was aware of the standards.
D. identifying standards under which the employee is judged.
E. indicating that the employee had an opportunity to correct their behaviour.
Answer: B. specifying any violation of the standards.
63. Susan, the HR director, is developing performance management training sessions for
junior managers. She wants to be sure to emphasize the key success factor for effective
performance appraisal that most often leads to optimum employee performance. The factor
she emphasizes is
A. effective career development discussions.
B. the quality of the performance appraisal dialogue between the manager and employee.
C. linking pay with performance.
D. legally compliant policies.
E. none of the above.
Answer: B. the quality of the performance appraisal dialogue between the manager and
employee.
64. The main purpose of appraising employees is to ensure that they follow instructions from
management and always perform to the best of their ability.
a. True
b. False
Answer: b. False
65. Most organizations are dissatisfied with their performance appraisal programs. They need
to downsize poor performers, but appraisal records indicate that all employees are performing
adequately.
a. True
b. False
Answer: a. True
66. Performance appraisal requires feedback sessions in which performance and progress are
discussed and plans are made for required development.
a. True
b. False
Answer: a. True
67. The most popular technique for appraising performance is the graphic rating scale.
a. True
b. False
Answer: a. True
68. When using the paired comparison method, for every trait, every employee is compared
to every other employee in pairs.
a. True
b. False
Answer: a. True
69. With the critical incident method, the rating reflects only the employee's most recent
performance.
a. True
b. False
Answer: b. False
70. The critical incident performance appraisal method can be geared directly to the specific
job expectations laid out for the employee at the beginning of the year.
a. True
b. False
Answer: a. True
71. A behaviourally anchored rating scale (BARS) combines the benefits of narratives,
critical incidents, and quantified ratings by anchoring a quantified scale with specific
behavioural examples of good or poor performance.
a. True
b. False
Answer: a. True
72. A behaviourally anchored rating scale takes less time than a graphic rating scale for the
supervisor to complete when undertaking performance appraisal.
a. True
b. False
Answer: b. False
73. A manager can implement a modest MBO program by jointly setting goals with
employees and providing feedback.
a. True
b. False
Answer: a. True
74. It would be a disadvantage for firms to combine several appraisal tools.
a. True
b. False
Answer: b. False
75. The use of critical incidents in performance appraisal provides specific examples of good
and poor performance.
a. True
b. False
Answer: a. True
76. MBO is time consuming.
a. True
b. False
Answer: a. True
77. When using a graphic rating scale, the central tendency error occurs when raters rate
people too high.
a. True
b. False
Answer: b. False
78. Research indicates that individual differences among ratees (in terms of characteristics
such as age, race, and sex) can affect the ratings they receive from supervisors.
a. True
b. False
Answer: a. True
79. Rater training is the most important thing to do to improve performance appraisal
accuracy.
a. True
b. False
Answer: b. False
80. The performance management process contains five steps. Identify and briefly describe
each step of the performance management process.
Answer: Two points each for accurate identification and description of the five steps:
1. Defining performance expectations and goals
2. Providing ongoing feedback and counseling
3. Conducting performance appraisal evaluation discussions
4. Determining performance rewards/consequences
5. Conducting development and career opportunities discussions
81. Identify and briefly describe five different performance appraisal methods.
Answer: Two points each for accurate identification and description of any five of graphic
rating scale, alteration ranking, paired comparison, forced distribution, critical incident,
narrative forms, BARS, or MBO.
82. Define MBO, describe the steps in the MBO appraisal program, and explain three
problems to avoid.
Answer: Management by objectives (MBO) involves setting specific measurable goals with
each employee and then periodically reviewing the progress made.
Set the organization's goals
- establish an organization-wide plan for next year and set goals
Set departmental goals
- department heads and their superiors jointly set goals for their departments
Discuss departmental goals
- department heads discuss the department's goals with all employees in the department (often
at a department-wide meeting) and ask them to develop their own individual goals. In other
words, how can each employee contribute to the department's attainment of its goals?
Define expected results (set individual goals)
- department heads and employees set short-term performance targets
Performance reviews: Measure the results
- department heads compare the actual performance of each employee with the expected
results
Provide feedback
- department heads hold periodic performance review meetings with employees to discuss
and evaluate progress in achieving expected results
Problems to Avoid
- Setting unclear, unmeasurable objectives is the main one
- MBO is time-consuming
- setting objectives with an employee sometimes turns into a tug of war, with the manager
pushing for higher goals and the employee pushing for lower ones
83. Identify and briefly describe five rating scale appraisal problems.
Answer: Two points each for accurate identification and description of any five of unclear
standards, halo effect, central tendency, strictness/leniency, appraisal bias, recency effect, or
similar-to-me bias.
Test Bank for Management of Human Resources: The Essentials
Nina D. Cole, Gary Dessler, Nita Chhinzer
9780133807332, 9780134305066
